Republicans cite donor pressure to deliver on tax bill

by MARCY GORDON and ERICA WERNER, Associated Press

Volumes of tax regulations are stacked on the dais as the House Ways and Means Committee begins the markup process of the GOP's far-reaching tax overhaul, the first major revamp of the tax system in three decades, on Capitol Hill in Washington, Monday, Nov. 6, 2017. (AP Photo/J. Scott Applewhite)

"We know who's watching, we know who you're all catering to today," Crowley lectured Republicans as the Ways and Means Committee launched into a second marathon day of amendments and votes on the sweeping, nearly $6 trillion bill, which would be the first major revamp of the U.S. tax system in 30 years.

"We also know that it's been rumored that if you don't get this done you might as well give up the majority, because you ain't coming back in the majority," Crowley said. "And that's kind of sad that that's how we're going to be putting together a tax bill that affects so many people."

Indeed, the political backdrop was inescapable as Republicans sought final action by year's end on the bill that's strongly supported by President Donald Trump as he and Congress' GOP majorities search for a legislative win they can take to voters next year.

Numerous issues were in play, including the precise levels for a mortgage interest deduction, whether an adoption tax credit would be restored to the bill, and whether the legislation would serve as a vehicle to repeal the "Obamacare" requirement for nearly all Americans to carry health insurance. A repeal would raise more than $400 billion to help pay for the tax measure because the government would no longer be paying as much in Medicaid and Affordable Care Act tax credits.

Trump has called for repealing the individual mandate, but after a press conference Tuesday with congressional Republicans Treasury Secretary Steven Mnuchin brushed aside a question about whether the president would accept a bill that didn't contain that provision.

"I'm not going to comment on that issue specifically. Again, the president wants to get a deal that will be signed," Mnuchin said.

"Nothing is more important to the president's economic agenda than tax reform and tax cuts," Mnuchin said.

Republicans are working overtime to present their legislation as a boon to the middle class, citing beefed-up child tax credits and overall decreases in the tax burden across all income levels in the next several years. Democrats call it a gift to corporations and the wealthy, and point to a nonpartisan congressional analysis showing taxes would actually go up beginning in 2023 for some 38 million taxpayers, or families, making $20,000 to $40,000 a year.

Late Monday, the Ways and Means Committee approved changes proposed by the chairman, Rep. Kevin Brady of Texas, to restore the tax exemption for employees receiving child care benefits from their companies. But it also added new requirements on a tax credit used by working people of modest means.

The vote for Brady's amendment was 24-16 along party lines. That pattern is likely to hold for votes on other possible GOP amendments through the next three days and on passage of the bill.

By the same margin, Republicans are set to turn back Democratic amendments aimed at undermining the bill. For example Democrats proposed to pay for the tax breaks by increasing the corporate tax rate as needed to cover the revenue losses — sharpening the conflict over the plan between middle-class Americans versus corporations

Senate Republicans aim to introduce companion legislation by Thursday and try to push a combined package through Congress and to Trump by Christmas. Trump made overhauling the tax system a campaign pledge and an economic promise.

The legislation would add $1.5 trillion to an already ballooning national debt as it delivers a major tax cut to corporations and repeals the estate tax, which would benefit a tiny percentage of the wealthiest families in the country.

It would collapse today's seven personal income tax brackets into four, nearly double the standard deduction used by people who don't itemize, and increase the child tax credit, an element championed by Ivanka Trump.

After embarrassing failures to make good on years of promises to repeal the Obama health law, the tax bill is enthusiastically backed by Trump, House GOP leaders and many rank-and-file Republicans.